Correlation Between Nushares ETF and Unified Series

Can any of the company-specific risk be diversified away by investing in both Nushares ETF and Unified Series at the same time? Although using a correlation coefficient on its own may not help to predict future stock returns, this module helps to understand the diversifiable risk of combining Nushares ETF and Unified Series into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Nushares ETF Trust and Unified Series Trust, you can compare the effects of market volatilities on Nushares ETF and Unified Series and check how they will diversify away market risk if combined in the same portfolio for a given time horizon. You can also utilize pair trading strategies of matching a long position in Nushares ETF with a short position of Unified Series. Check out your portfolio center. Please also check ongoing floating volatility patterns of Nushares ETF and Unified Series.

Diversification Opportunities for Nushares ETF and Unified Series

0.62

Correlation Coefficient

Nushares ETF  Unified Series

Poor diversification

The 3 months correlation between Nushares and Unified is 0.62. Overlapping area represents the amount of risk that can be diversified away by holding Nushares ETF Trust and Unified Series Trust in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Unified Series Trust and Nushares ETF is a relative statistical measure of the degree to which these equity instruments tend to move together. The correlation coefficient measures the extent to which returns on Nushares ETF Trust are associated (or correlated) with Unified Series. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Unified Series Trust has no effect on the direction of Nushares ETF i.e., Nushares ETF and Unified Series go up and down completely randomly.

Pair Corralation between Nushares ETF and Unified Series

Given the investment horizon of 90 days Nushares ETF Trust is expected to generate 0.79 times more return on investment than Unified Series. However, Nushares ETF Trust is 1.26 times less risky than Unified Series. It trades about 0.02 of its potential returns per unit of risk. Unified Series Trust is currently generating about -0.07 per unit of risk. If you would invest  2,736  in Nushares ETF Trust on December 30, 2024 and sell it today you would earn a total of  22.00  from holding Nushares ETF Trust or generate 0.8% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Significant
Accuracy	100.0%
Values	Daily Returns

Nushares ETF Trust  vs.  Unified Series Trust

Nushares ETF Trust

Risk-Adjusted Performance

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in Nushares ETF Trust are ranked lower than 1 (%) of all global equities and portfolios over the last 90 days. In spite of fairly stable fundamental indicators, Nushares ETF is not utilizing all of its potentials. The recent stock price fuss, may contribute to near-short-term losses for the sophisticated investors.

Unified Series Trust

Risk-Adjusted Performance

Very Weak

Over the last 90 days Unified Series Trust has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of rather sound essential indicators, Unified Series is not utilizing all of its potentials. The recent stock price tumult, may contribute to shorter-term losses for the shareholders.

Pair Trading with Nushares ETF and Unified Series

The main advantage of trading using opposite Nushares ETF and Unified Series positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Nushares ETF position performs unexpectedly, Unified Series can make up some of the losses. Pair trading also minimizes risk from directional movements in the market. For example, if an entire industry or sector drops because of unexpected headlines, the short position in Unified Series will offset losses from the drop in Unified Series' long position.

The idea behind Nushares ETF Trust and Unified Series Trust pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.

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Note that this page's information should be used as a complementary analysis to find the right mix of equity instruments to add to your existing portfolios or create a brand new portfolio. You can also try the Money Managers module to screen money managers from public funds and ETFs managed around the world.